Abstract: This paper starts with the observation of market reaction after the policy of Measures for the Administration of the Issuance of Securities by Listed Companies is enacted in 2006 to test the effect of dividend regulatory policy on the dividend policy of listed companies in China by use of One-Way ANOVA and difference-in-difference method. The results show that, total cash dividend level after 2006 did not improve, and there are no significant policy effects; a further exploration to listed companies with a stake in the refinancing based on DID model shows that, the dividend per share has a tendency to reduce. This policy did not have a clear incentive effect on distributing cash dividends of listed companies, and produce expected results.

Key words: dividend regulatory policy, cash dividend, market reaction